If I were investing today with $1,000 then I have two ASX shares in mind, depending if I were going for growth or income.
The market is rebounding hard after a few positive quick-fire updates about three different COVID-19 vaccines. But there are some ASX shares I still believe are good value for the long term in my opinion:
Growth pick: Pushpay Holdings Ltd (ASX: PPH)
Pushpay is a business involved in offering technology to help US large and medium churches receive digital donations. It has a community app that allows the church to connect with its congregation. One part of the app is that it offers a livestreaming service, which is handy in this era of COVID-19.
For me, the FY20 result was extremely impressive. Its operating revenue increased by 53% to US$85.6 million and total revenue rose 51% to US$86.6 million. Total processing volume went up 48% to US$3.2 billion. It’s expecting more volume as it wins more churches and more people adopt Pushpay’s technology.
The gross profit margin improved from 65% to 68%. As a percentage of operating revenue, the EBITDAF margin (EBITDA explained) grew from 17% to 31%. Pushpay reported that its EBITDAF grew by 177% to US$26.7 million.
Net profit before tax grew 121% to US$18.8 million and net profit after tax (NPAT) went up by 107% to US$13.4 million. The NPAT margin improved from 12% to 16%. Operating cashflow went up by 203% to US$27 million.
I think there is plenty of market share growth, profit margin growth, revenue growth and profit growth for Pushpay. The Pushpay share price has been falling back in recent weeks, so I think this could be an opportunistic time to buy.
Dividend pick: Brickworks Limited (ASX: BKW)
Many ASX dividend shares are highly prized at the moment with how low interest rates are. Brickworks could be a good business to buy for dividends. It hasn’t cut its dividend in over four decades, so it can provide a lot of certainty.
Brickworks funds its dividend purely from the distributions from its 50% stake in a high-quality industrial property trust and from the dividends from its investment in investment house Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). Upcoming completions of large warehouses for Amazon and Coles Group Ltd (ASX: COL)
The Australian construction product side of the business is bouncing back as COVID-19 impacts go away, though the US construction side of things is suffering because of the surging number of cases there.
At the pre-open Brickworks share price of $20.22, it has a dividend yield of 4.2% including the franking credits.
Summary thoughts
Both of these businesses are good ASX shares and could be good long term buys. Of the two, whilst I really like dividends, I think I’d go for Pushpay first because I think it has excellent long term growth potential. There are also other ASX growth shares I’d also like to add to my portfolio like A2 Milk Company Ltd (ASX: A2M).
